Female Founders Still Face Sexual Harassment From Investors

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Female Founders Still Face Sexual Harassment From Investors

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Though many (mostly male) founders continue to doubt the extent of sexual harassment in the startup sphere, a new survey from Y Combinator suggests that the venture capital scene is far from a safe place for female entrepreneurs: More than 20 percent of women who responded said they had been harassed. In its blog post about the findings, YC also stated that it's created a “formal process for founders in the YC community to report bad behavior by investors.”

The survey comes from a partnership between Y Combinator and Callisto, a nonprofit startup dedicated to fighting sexual harassment which received funding from the seed accelerator in March.

The two companies sent surveys to 125 of the 384 female founders who have received funding from Y Combinator, drawing on YC’s female founder email list. Of the 88 women who responded, 19 said that they have experienced one or more “inappropriate incidents” at the hands of investors. Eighteen respondents said they had experienced unwanted sexual advances or “sexual badgering”; 15 said they had experienced sexual coercion or pressured into a quid-pro-quo situation;” and four founders said they had been the victims of “unwanted sexual contact.”

Though YC did not indicate how many founders reported these instances of sexual harassment outside of the survey, it did note the reasons respondents gave for their decisions. Those who did choose to report said their main motivator was the opportunity to protect others from falling victim to the same type of harassment. According to comments highlighted by Y Combinator, founders were particularly worried about the effect repeat offenders in the VC industry could have on other women looking for investments. “I wanted to make sure that other founders funded by this VC would NOT be in contact with this person, so I shared,” wrote one founder.

Unsurprisingly, YC founders who chose not to report primarily cited fears of retaliation from investors. Two survey responses highlighted by Y Combinator suggested that coming forward about their experiences would “endanger” their company’s prospects for future funding rounds. “VCs would penalize women for coming forward by icing them out of social and professional situations and denying them funding opportunities,” wrote an anonymous respondent, “meaning the bad behavior rarely got outed.”

Their worries are far from unfounded. Women are outnumbered in the venture capital ecosystem, and the power dynamics at play between investors and entrepreneurs only exacerbate the numerous gender issues already at play in tech. Susan Fowler’s February 2017 blog about the systemic culture of sexual harassment at Uber was supposed to be the start of tech’s big reckoning, but it’s difficult to say what, if anything has changed, especially in the VC sector. Last December, an uncomfortable 19 percent of startup founders surveyed by venture capital firm First Round Capital said they thought claims of sexual harassment in the tech sphere were overblown. Despite being accused of harassment by six women last June, former Binary Capital partner Justin Caldbeck has already returned to public life.

California recently expanded state protections against sexual harassment, including specifically in venture capital. While the civil code already prohibited sexual harassment between people who don’t work for the same company yet still have a business relationship of some sort, including harassment from lawyers, teachers, landlords, and others, investors weren’t explicitly named until now.

On Monday, Y Combinator directed female founders who have experienced inappropriate behavior to use its internal reporting system, and pledged to support any YC founder interested in taking “actions above and beyond reporting this behavior to YC.” The company also noted that it would continue to fund startups dedicated to addressing gender issues in the workplace, like Callisto, which claims to provide a secure platform for survivors of sexual assault or harassment to identify offenders and stay informed of their options. Though Callisto is currently primarily used on college campuses, the company plans on releasing a version of the tool specifically for female founders this fall.

According to a description of the tool provided by Y Combinator, founders will be able to securely input the identity of a perpetrator into Callisto, where it will rest, encrypted, until multiple accusations are made against the same individual. “If multiple founders name the same perpetrator, they will be referred to an attorney who can then decrypt the founder’s contact info and reach out to provide them with free advice on their options for coming forward, including the option to share information with other victims of the same perpetrator,” YC wrote.

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